Sampling error

CFA level I / Quantitative Methods: Application / Sampling and Estimation / Sampling error

The difference between the sample mean and the population mean is called sampling error. It is the difference between the observed value of a statistic and the quantity it is intended to estimate.

For example, the mean annual return for a population of returns of a mutual fund is 14.30 percent, and a sample of the returns from that population gives a sample mean of 13.50 percent. Then the sampling error is minus 0.8 percent (=13.50 percent - 14.50 percent)

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